Regents share blame in mess with foundation

Editorial

Posted: Friday, April 22, 2005

While the University System of Georgia Board of Regents made the right call in telling University of Georgia President Michael Adams to terminate the school's relationship with the private, nonprofit University of Georgia Foundation, it hasn't really solved the problems inherent in allowing private dollars - and private influence - on public campuses.

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At its Wednesday meeting in Savannah, the Board of Regents, which oversees the state's 34 public colleges and universities, indicated there is absolutely, positively no way the University of Georgia Foundation, which manages the school's $475 million endowment, will be allowed to renegotiate its way back into the regents' good graces.

That indication came after the regents, for the second time in slightly less than a year, ordered Adams to sever ties with the foundation. The initial order came in May 2004, but by August, based on assurances the foundation understood its sole purpose was to support the university, the regents backed down. Between then and Wednesday, those assurances had begun to ring hollow, as the regents and the foundation spent months going back and forth over a "memorandum of understanding" designed to clearly delineate the relationship between the foundation and the university.

The regents had sought, and got, signatures on similar agreements with the state's 33 other institutions of higher learning, but UGA's foundation representatives dragged their feet to the point of ignoring an April 12 regents' deadline. It was that disregard that finally prompted the regents to tell Adams, again, to disentangle the university from the foundation.

In what is now, hopefully, the aftermath of a contentious two years between the foundation and Adams, the stunning thing, in retrospect, is the absolute arrogance of the foundation. The group tried to parlay its control of some of the university's purse strings, including a sizable supplement to Adams' state-paid salary, into control of the university. Beginning in 2003, after Adams opted not to renew former athletic director Vince Dooley's contract, some foundation members began a campaign clearly designed to oust Adams, eventually calling for an audit of Adams' expenditures of foundation money. In both instances - the non-renewal of Dooley's contract and the audit - regents repeatedly expressed their support for Adams.

While the regents have done what needed to be done in ordering that the foundation be jettisoned, they have done little more than lay the groundwork for another situation ripe with the potential for problems. In giving Adams carte blanche to assemble a new foundation, they've created a scenario where the potential for cronyism raises the possibility for misuse of donor dollars.

It's a problem the regents helped create, by virtue of their willingness to allow private supplementation of university presidents' salaries through foundations. In allowing that, the regents did nothing less than invite the UGA Foundation to flex some political muscle, which some foundation members used to kick Adams around - and damage the institution they were supposed to be supporting - to express their displeasure with the president's handling of the Dooley situation.

While they should stick to their stated intent to end the university's relationship with the foundation as presently constituted, the regents also ought to consider their own complicity in the unhealthy events of the last two years. As the dust settles, University System Chancellor Tom Meredith and the regents ought to start working to convince state legislators that salaries of the system's presidents should be fully funded with state tax dollars. The regents moved a half-step in that direction last year, ordering that presidential supplements come out of a school's general fund rather than directly from a foundation. But that's little more than bureaucratic sleight of hand, with all parties fully aware the supplement is in effect being paid with private funds generated largely by the foundation.

While insisting presidential salaries be paid fully with state funds would be expensive, it's one way of keeping people with little more in their portfolios than a checkbook and a Rolodex filled with other well-heeled names from thinking they've got some right, or ability, to run their alma maters.

The regents have taken a step in the right direction by ordering the university to sever ties with its foundation, but they've still got some distance to go to ensure private hands are kept off the levers of power at public institutions.